I had lunch with a few friends just days before Chinese New Year (CNY). Everyone was saying they had no CNY mood. (I think it’s more of age?) However, they agree about one thing, the malls were now packed with shoppers. I told them that NOT all malls. There are malls which when we visit for the first time these days, we can already nearly conclude that unless something drastic happens, the mall will be shutting down within the next 12 months or lesser, depending on who’s the owner. Some replied that hypermarkets were packed with people. Again, I reminded them, not all hypermarkets. I have been to a few where car parks were still easy to find; in seconds upon arrival.
Let’s look at some industry news then. Reported in the local media, the Malaysian Small and Medium Industries president Michael Kang said nationwide, the retail sector saw an average 20% to 30% drop in sales during Chinese New Year. I personally do not like average numbers. Are the drops because the bigger malls are getting all the businesses while those in the less popular spots are now getting far fewer customers who prefer to shop at one place instead of many different places? It’s okay, we assume this number is talking about the sales in RM. Michael further commented that this drop may repeat itself in Hari Raya Aidilfitri, Deepavali and Christmas too, with prices going up and consumers cutting back on spending.
According to the full article, this trend was for all range of CNY related wares such as such as fruits, clothing and prayer items. For fruits if we are talking about mandarin oranges, let’s do a survey within my family. Many years ago, we used to buy at least two boxes every CNY. These days, we could not even finish one box and I personally have eaten just ONE slice given to me by my brother a few days ago. Is it just me or mandarin oranges are just the most favourite fruit during CNY these days? I prefer to eat canned Lychees or Longans instead. Oh yeah, canned King Lychees were only RM8.88 for THREE cans in Sunshine Square. I thought Ringgit depreciated so much?
I am not sure but I seriously think the trend is really shifting. For clothing, I told my colleagues just days before CNY that this is the year I bought the most number of new clothes because the prices were unbelievable. Two polo shirts for RM59. Two long sleeve shirts (EASY CARE) for RM39. Two collar T-shirts for just RM47. In total, I bought 300% more than last year! Yet, spending almost the same. I think in terms of RM, I am really spending less this year.
I visit the temple on the first day of CNY without fail every year. This year, the cars parked in the temple compound are still full. However, in my visits to many of friends of my age and even the younger ones, many are definitely not buying prayer items for their homes. The trend for high-rise living is rising by leaps and bounds too. I think it’s very clear that even during the perceived good years, some of these items would definitely not be selling as much as previous years.
Before everyone now conclude that 2015 was indeed so bad it extended well into 2016, do take a look at the sale of luxury cars last year. It has increased by leaps and bounds too. The house prices, on average were still increasing in KL. It is expected to increase again in 2016. (I hate all these reports, I still think there are good properties which are undervalued, just have to work harder in identifying them) The retail tenants especially for the very popular malls are definitely renewing their lease even as the smaller and less popular malls struggle to keep their tenants. In fact, even one listed company for clothing, Padini reported solid earnings even though it was facing strong competition from many new foreign entrants. Expansion is still continuing.
The number of people buying ONLINE from their mobile phone or even notebooks are also increasing by leaps and bounds. Yes, this is also the reason why certain companies are still hiring while some companies are firing. The right industry helps tremendously while the wrong ones meant we have to find a new job. The catch? Strive to be valuable enough so that if needed, we can switch industry or role if needed.
My personal advice? Understand why some people are earning so much that they are now driving luxury cars. My personal conclusion? I seriously think I must spend even more time viewing properties. Who knows, the owner may just happen to be a very motivated seller. Luck comes on and off when we are lucky but it comes almost all the time to those who work hard. This was my personal sales mantra to all my top sales people previously and I think still true today. Happy Chinese New Year!
written on 15 Feb 2016
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